InfuSystem Holdings, Inc. Reports Third Straight Quarterly Profit

Related Links

MADISON HEIGHTS, Mich.--
InfuSystem Holdings, Inc. (NYSE MKT: INFU) (“InfuSystem” or the
“Company”), a leading national provider of infusion pumps and related
services for the healthcare industry in the United States, today
reported its third consecutive quarter of profitability in the first
quarter ending March 31, 2013.

Net income in the first quarter was $0.1 million, equal to $0.00 per
diluted share, compared to a $0.9 million net loss, or $0.04 loss per
diluted share, in the prior year period. Gross profit for the three
months ending March 31, 2013, was $10.4 million, consistent with the
same prior year period.

“Our industry in general and InfuSystem in particular are
well-positioned for continued growth,” said Eric Steen, who joined the
Company as Chief Executive Officer on April 1, 2013. “We are firmly
committed to organic growth as a means to further strengthen our
position in a highly competitive environment. We remain vigilant about
managing costs, and will seek to further increase free cash flow and
reduce debt. Finally, as evidenced by our recent hiring of an
accomplished Chief Information Officer, we will use technology to
increase connectivity with all stakeholders – especially patients, who
are number one priority,” he concluded.

Revenues in the first quarter of 2013 were $14.7 million, up 2% from
$14.3 million in the first quarter of 2012. The increase in revenues is
primarily related to the addition of larger customers, increased
penetration into existing customer accounts, continuation of the
revision to claims processing guidelines by a major group of third-party
payors and a one-time delay in billing to certain payors caused by the
requirement of additional paperwork.

SG&A decreased to $7.4 million from $9.0 million, down approximately
18%, when compared to the first quarter of 2012. The decrease was
primarily attributed to prior year costs of $1.5 million pertaining to
the special meeting, changes in the composition of the Board of
Director’s, and retention payments made to key employees in connection
with the change in senior management.

Other expenses were consistent for the three months ended March 31, 2013
compared to the similar period in 2012; however the breakdown included
$0.3 million of additional interest expense due to the cost of the new
debt facility. This was offset by a one-time cash receipt of $0.3
million related to a mutual insurance policy.

“We are very pleased to have further strengthened the balance sheet,
especially reducing total debt by $2.8 million during the first quarter
of 2013,” said Jonathan P. Foster, Chief Financial Officer.

Operating Results

Gross profit for the three months ended March 31, 2013 was $10.4
million, which was consistent with the same period in the prior year. It
represented 71% of revenues in the current period compared to 73% in the
prior year. The decrease in the gross margin as a percentage of revenue
in 2013 was primarily related to an increase in connectivity costs with
our customers.

Selling and marketing expenses were $2.4 million compared to $2.7
million for the three months ended March 31, 2012. The decrease in
selling and marketing expenses was mainly attributed to lower travel,
entertainment and salaries.

During the months ended March 31, 2013, general and administrative
expenses were $5.0 million compared to $6.3 million for the same prior
year period. General and administrative expenses have decreased from 44%
to 34% of revenues for the first quarter of 2013 compared to the same
period in the prior year. The decrease was primarily attributed to prior
year costs of $1.5 million pertaining to the special meeting, changes in
the composition of the Board of Directors, and retention payments to key
employees during the major change in senior management. These prior year
charges were offset by $0.3 million of expenses during the three months
ended March 31, 2013 due primarily to fees related to the CEO search,
the final Severance Payment made to the former CEO and one-time payments
to a Board member (the “Transition Costs”).

Adjusted EBITDA was $3.7 million for the first quarter of 2013 compared
to $3.4 million in 2012. The Company utilizes Adjusted EBITDA as a means
to measure its operating performance. A reconciliation from Adjusted
EBITDA, a non-GAAP measure, to net income can be found in the appendix.

Financial Condition

Net cash provided by operations for the three months ended March 31,
2013 was $1.6 million compared to a use of cash of less than $0.1
million for the prior year. The increase is primarily attributed to
decreased general and administrative costs of $1.3 million when compared
to the three months ended March 31, 2012. This includes professional
fees of $0.9 million related to the special meeting and change in
members of the Board of Directors, and a retention payment of $0.6
million paid to employees during the major change in senior management.
The decreases were partially offset by an increase of $0.3 million of
expenses during the three months ended March 31, 2013 due primarily to
transition costs.

As of March 31, 2013, we had cash and cash equivalents of $0.5 million
and $7.0 million of availability on the revolving line-of-credit
compared to $2.3 million and $4.7 million, respectively, at December 31,
2012. During the three months ended March 31, 2013, the Company paid
down $2.8 million of total debt.

Conference Call

The Company will conduct a conference call for investors on Tuesday, May
14, 2013 at 9:00 a.m. Eastern Time to discuss first quarter performance
and results. Eric Steen, Chief Executive Officer, and Jonathan P.
Foster, Chief Financial Officer, will discuss the Company’s financial
performance and answer questions from the financial community. To
participate in this call, please dial in toll-free (888) 895-5271 and
use the confirmation number 34802235.

About InfuSystem Holdings, Inc.

InfuSystem Holdings, Inc. is a leading provider of infusion pumps and
related services to hospitals, oncology practices and other alternate
site healthcare providers. Headquartered in Madison Heights, Michigan,
the Company delivers local, field-based customer support and also
operates Centers of Excellence in Michigan, Kansas, California, and
Ontario, Canada. The Company’s stock is traded on the NYSE MKT under the
symbol INFU.

Forward-Looking Statements

Except for the historical information contained herein, the matters
discussed in this press release are forward-looking statements that
involve risks and uncertainties that could cause actual results to
differ materially from those predicted by such forward-looking
statements. These risks and uncertainties include general economic
conditions, as well as other risks, detailed from time-to-time in the
Company’s publicly filed documents.

Additional information about InfuSystem Holdings, Inc. is
available at www.infusystem.com.

INFUSYSTEM HOLDINGS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

March 31,

December 31,

(in thousands, except share data)

2013

2012

(Unaudited)

ASSETS

Current Assets:

Cash and cash equivalents

$

472

$

2,326

Accounts receivable, less allowance for doubtful accounts of $3,601
and $3,136 at March 31, 2013 and December 31, 2012, respectively